INDIA: Global sugar industry sees imminent sugar imports
Published: 02/14/2017, 8:53:25 AM
Following exports just a few seasons ago, low sugar production will lead India to import soon from the global sugar market, 65 of 97 global sugar industry participants said at the Dubai Sugar Conference on Tuesday, reports Sugaronline.
This follows from earlier industry consultation on Sunday that saw 68% of participants agree 2016/17 sugar production would reach only between 19 million and 20.5 million tonnes, below annual consumption of around 25 million tonnes. Not surprisingly, 76% of respondents said the country would not have a domestic surplus, with only 3% believing there would be no imports this year.
Despite assurances from Toby Cohen, Vice President for Market Analysis at ASR Group, that prices have not risen enough for the government to justify imports in the face of mills who need strong prices to pay farmer dues, market consensus continues to insist imports will be needed.
"Changes in Indian production have a large impact on the world market, creating the volatility [the trade likes], but from the point of view of an Indian farmer and policymaker, this is a massive problem," Cohen said. "The position we're in today politically is that it's still a bad idea to come to the market to import sugar. What we know about the balance sheet today says stocks are available, and with the ongoing crush there is no immediate problem."
Sean Diffley, head of sugar and cane ethanol research at Tropical Research Services, estimates production at 20.3 million tonnes but he will likely wind that figure down further to 20 million tonnes in the next two weeks as the crush winds down.
"The needs of the balance sheet call for imminent imports," Diffley said, but admitted the integrity of data may make it difficult to estimate how much exactly will be needed.
With more than 50% of Dubai Sugar survey respondents seeing imports of between 2 million and 4 million tonnes, the remaining 44% see imports either above or below that level, but imports there will be.